Vaccinia virus produces two different infectious forms, intracellular mature virus (IMV) and extracellular enveloped virus (EEV). Acquisition of the EEV envelope occurs by wrapping of IMV with vesicles of the trans-Golgi network (TGN). The most abundant protein in the envelope of EEV, P37, is a 37 kDa palmitylated protein encoded by the F13L gene. P37 is located in the inner side of the EEV envelope and accumulates in the TGN during infection. Deletion of gene F13L results in a severe defect in the wrapping process, although normal levels of IMV are produced. A cell line, derived from RK-13 cells, was obtained that stably expressed P37 (RK(P37)), and the properties of the protein were studied in the absence of other viral polypeptides. P37 produced in RK(P37) cells differed from P37 produced in vaccinia-infected cells in terms of hydrophobicity and intracellular distribution. Despite these differences, RK(P37) cells partially complemented the phenotypic defect of vaccinia virus P37- mutants. EEV production and cell-to-cell virus spread by mutant viruses were increased significantly in RK(P37) cells when compared to normal RK-13 cell cultures. Infection of RK(P37) cells with P37- virus substantially altered the hydrophobicity and the intracellular distribution of P37 in those cells. These results indicate the requirement of the infection context for determination of the normal palmitylation and intracellular localization of P37.